Nortel Networks is a multinational telecommunication equipment manufacturer from Canada. In January 2009, the company filed for bankruptcy. Since then, Nortel has been selling different areas of the company off in order to restructure its debt. For instance, Genband bought Nortel's VOIP business in February 2010.

Now, Google is looking to purchase the remaining 6,000 networking and wireless patents from Nortel in order to produce a deeper portfolio and to "stave off increasingly rampant patent litigation." Google has mentioned that it is patent poor and could use a broader portfolio to stay competitive.

"One of a company's best defenses against this kind of litigation is to (ironically) have a formidable patent portfolio, as this helps maintain your freedom to develop new products and services," said Kent Walker, Google's senior vice president and general counsel.

As of right now, Google is dealing with a lawsuit from Oracle, which is an open and integrated hardware and software systems company. Oracle claims that Google's Android platform uses Java code illegally, which is covered in its patents. A deeper patent portfolio would have saved Google from this copyright infringement lawsuit.

As of right now, Google is the most interested buyer in the early stages of the patent auction. According to recent reports, the deal is a "stalking horse asset sale agreement," which allows other companies to bid against Google before the auction, where Google is the starting point.

According to J.P. Morgan analysts, Apple has also shown interest in the auction. More specifically, Apple is looking to compete with Google for Nortel's patents for 4G wireless communications called Long Term Evolution (LTE). Research in Motion may be another bidder in the upcoming auction.

Nortel's patent auction is expected to begin in June, as long as U.S. and Canadian courts approve it.

"If successful, we hope this portfolio will not only create a disincentive for others to sue Google, but also help us, our partners and the open source community - which is integrally involved in projects like Android and Chrome - continue to innovate," said Walker.

Google is also in the midst of considering a $700 million purchase of ITA Software Inc., which may prompt an antitrust investigation of Google's web dominance by the Federal Trade Commission and the Justice Department.

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